Political risk assessment on air logistics hub developments in Taiwan

Political risk assessment has long been practiced by multinational corporations, but has been rarely used for air performance reviews. This study is a political risk assessment of the development of an air logistics hub in Taiwan, and thus examines the factors leading to physical property losses of air carriers based at the hub. It utilizes a checklist and a brainstorming session to identify risk factors, a 5×5 risk matrix to undertake a qualitative risk survey, and an analytical hierarchy process to assess the risk. The study concludes that micro- and macro-factors are approximately of equal importance to the development of an air hub in Taiwan. Issues relating to inland vehicle parking, air logistics infrastructure developments and the cross-strait relationship appear to be particularly crucial.     

Urban and population decentralization policies: the experience of Taiwan,R.O.C.

The policies that have been successfully implemented in Taiwan to minimize the impact of urbanization and to slow the pace of population concentration are described. Consideration is given to policies designed to affect spatial distribution both directly and indirectly.     

New Evidence of Interest Rate Pass-through in Taiwan: A Nonlinear Autoregressive Distributed Lag Model

We adopt the newly developed nonlinear autoregressive distributed lag model, advanced by Shin, Yu and Greenwood-Nimmo [(2014) Modelling asymmetric cointegration and dynamic multipliers in a nonlinear ARDL framework, in: Festschrift in Honor of Peter Schmidt, pp. 281–314 (New York: Springer)], to investigate the interest rate(IR) pass-through (IRPT) mechanism in Taiwan from 1971 M07 to 2014 M11. We find that the incomplete IRPT mechanism of deposit markets shows an asymmetric adjustment in the short run and symmetric adjustments in the long run. The deposit rate is rigid downward, which supports the customer reaction hypothesis. Moreover, we find that both the short-run and the long-run IRPT channels from the policy rate to the lending rate are also incomplete in the short run but not in the long run. The purpose of this paper is to provide accurate assessment criteria for the central bank to understand the nonlinear dynamics among the policy IR and the retail IR, thus leading to more efficient policy-making and forecasting for the Taiwanese government.     

The comparative role of iShares and country funds in internationally diversified portfolios

This paper examines the performance and diversification gains provided by iShares versus closed-end country funds over the period 1996 through 2006. Findings include: (1) iShares reveal weaker effects from U.S. market exposure than do country funds; (2) U.S. investors react similarly to foreign currency risk associated with iShares and country funds; (3) the average risk-adjusted performance of passively managed iShares is better than that of their respective actively managed country funds; and (4) iShares provide U.S. investors greater diversification gains than do country funds, that is, U.S. investors should prefer iShares to country funds when diversifying portfolios internationally.     

Cluster evolution of IC industry from Taiwan to China

In this work, we for the first time study the inter-industrial clustering behaviors of integrated circuit (IC) industry from Taiwan to China via amount of foreign direct investment (FDI). According to the mutual dependence among IC design, manufacturing and packaging-and-testing industries, Lotka-Volterra model is solved to explore the cluster evolutions. Effects of inter-level collaborations along production value chain on FDI flows into China are considered. Evolution of FDI into China for IC design industry significantly inspires the subsequent FDI of IC manufacturing, packaging and testing industries. Since the production of IC manufacturing, packing and testing enterprises depends on the preceded products that design industry has devised, the middle-stream manufacturing and downstream packaging-and-testing firms tend to converge toward upstream design houses. Taiwan IC industry's FDI amount into China is estimated to be cumulatively increasing, which suggests the clustering tendency of Taiwan IC industry. Prediction of FDI with Lotka-Volterra model is superior to that of the conventional growth model (i.e., Bass model) because the industrial mutualism among various stages is included. The flows of FDI have not yet reached equilibrium points, so the FDI inflows into China will expand for IC design or packaging-and-testing industry, while decline for manufacturing industry.     

Reputation versus information: The delegation policy when the principal has reputational concerns

We analyze the delegation policy when the principal has reputational concerns. Both the principal and the agent can be either good or biased; the good players prefer the correct decision, while the biased ones prefer a high action even though it may be wrong. An evaluator who forms the principal's reputation may or may not be able to observe who makes the decision. When the evaluator cannot observe the allocation of authority, the principal shares the credit and blame with the agent. Although delegation can improve the quality of decision making because the agent has better information, it may also hurt the good principal's reputation because the high action may be taken by the biased agent while the blame will be shared when it is wrong. Thus, the good principal has a tendency to keep too much authority to maintain her reputation. By contrast, when the evaluator can observe the allocation of authority, delegation becomes a signaling device for the good type of principal to differentiate herself from the biased one. This results in an excessive allocation of authority toward the agent.     

Mandatory Retirement and Older Worker Employment Decisions: Evidence from a Matched Difference‐in‐Differences Estimator

In 2008, the minimum age at which private‐sector workers in Taiwan could be forced by their employers to retire from their jobs was raised from 60 to 65 years. In this study, we evaluate the effects of the increase in the mandatory retirement age on the labour supply trend among the elderly using a nationally‐representative Taiwanese panel data set. Based upon the application of a combination of matching and difference‐in‐differences approaches, we find that postponing mandatory retirement has a significant effect, in terms of slowing down the withdrawal of the elderly from the labour force. Among elderly workers affected by the 2008 amendment, particularly those retiring from the public sector, the likelihood of re‐entering the labour market is found to be 3 to 4% higher than that for their counterparts who were not subject to such a constraint, a finding that clearly suggests that an increase in the mandatory retirement age helps to alleviate the problems associated with an aging population in countries where long‐term labour contracts are prevalent.